With the farm bill in mind, two Midwestern senators called for a “hard cap” of $250,000 in crop subsidies per farm, coupled with rules to limit the money to working farmers on Thursday. It would be an about-face in policy from recent years of easier access to USDA supports and emergency programs that paid up to $750,000 to corporate entities.
“This bill brings honesty to the farm payment system and prioritizes farming families over mega farms,” said Iowa Sen. Chuck Grassley, who unsuccessfully tried to reform payment limits in previous farm bills. Ohio Sen. Sherrod Brown, who joined Grassley in the new effort, said, “Too often, farm program payments have gone to producers who do not need the support or to people who aren’t even involved in farming.”
The Grassley-Brown bill would set a maximum commodity payment of $125,000 per person and $250,000 per farm per year; similar to the current limit of $125,000 per farmer with spouses automatically eligible for subsidies. The bill would require recipients to perform at least 1,000 hours of labor and management annually, equal to working full time for 25 weeks. It would be a “hard cap” because it would eliminate loopholes and lax definitions now available.
Congress has tried since 1987 to restrict access to federal farm subsidies but there are many ways to evade the rules, which say supports are available to people who are “actively engaged” in agriculture, meaning they provide land, capital or equipment to an operation and provide labor or management. For years, there was little or no definition of “management.” The Government Accountability Office, a congressional agency, reported in 2018 that a farming operation received $651,000 in subsidies in 2012 with 16 of its 22 members claiming they provided active management.
During the Trump era, the USDA exempted family-run farms — the vast majority of operations — from a regulation that required people to perform at least 500 hours of active management, or 25 percent of management work needed on the farm in a year, to collect a subsidy check as a manager. Trump officials created trade-war and pandemic-relief programs with limits of $250,000 per person and $750,000 for limited partnerships, corporations and limited liability companies.
And lawmakers decided in the 2018 farm law to make first cousins, nieces and nephews eligible for farm subsidies as family members, expanding the number of people who qualified for payments as part of joint operations comprised of family members.
The Grassley-Brown bill also would remove a provision that doubles the payment limit for peanut farmer and would end an exemption from payment limits for farms organized as general partnerships.
“At a time when work requirements have been debated at length with respect to food assistance for food-insecure Americans, it is time for an honest discussion about targeting farm commodity payments to working family farmers,” says a two-page summary of the bill. “The 2023 farm bill should adopt strong, effective, and loophole-free payment limits. The Farm Program Integrity Act provides the roadmap for achieving this important farm policy objective.”
Also on Thursday, New Jersey Sen. Cory Booker filed a bill to restrict corporations and their subsidiaries, pension funds and investment funds from buying or leasing agricultural land. The investors could keep the land they own now but would be be eligible for USDA programs.
Grassley, a Republican, and Democrats Brown and Booker are members of the Senate Agriculture Committee.
To read a two-page summary of the Grassley-Brown bill, click here.
The text of the Grassley-Brown bill is available here.